Safe and smart holiday shopping

Thieves will be everywhere; sales probably will not

By

RayMartin

BOSTON (CBS.MW) -- Finally, the economy is showing signs of growth and consumers report feeling more positive about their financial situations. According to the National Retail Federation, holiday spending is projected to be up 5.7 percent this year.

With more people spending more money on gifts this year, it's more important than ever to be a safe, smart shopper.

Safe shopping

Anecdotal evidence from across the country tells us that crime increases during the holiday season. Thieves are smart and they know that consumers are carrying more cash, spending more money and bringing home bags of expensive merchandise.

This is the time of year to take extra caution when shopping -- don't flaunt your money, don't carry around armloads of packages and don't leave packages in a visible spot in your car.

But in addition to protecting your person, you need to take some steps to protect your finances:

Clean out your wallet. When heading to the mall, only take the identification and credit cards you actually need to make your purchases. Leave other cards and personal information at home. If your wallet is swiped, your losses will be smaller.

List your accounts. Create a list of every credit/debit/ATM card you will carry with you on your shopping trips. Include each card's account number, expiration date and the phone number listed on the back of the card. Leave this list at home. If you lose your wallet/purse it will be easy to quickly close all of your cards and ask for new ones.

Keep cards in sight. When you hand your credit card to a clerk to pay for your purchase, keep an eye on it. If the sales person has to "run to the back" or otherwise leave the register, don't let them take your card along. You don't want to run the risk of someone taking an imprint of your card and then using it later.

Review account activity. You are probably making more purchases than usual right now. Keep all of your receipts and be sure to match them promptly to your bank statements. If you can access your statements online, you should check account activity more frequently over the next few weeks. Early detection and reporting of a problem (such as reporting unauthorized charges on your charge card) will stop the fraudsters and limit your liability. This is a shopper's best defense against fraud and identity theft.

Visit banks for cash. If you must get cash while out shopping, use ATMs provided by your bank -- preferably those in the bank's lobby. Avoid stand-alone ATMs. These do not have security cameras and are much more susceptible to being fitted with "skimmers" -- electronic devices that allow thieves to record account numbers and PINs of unsuspecting users.

Smart shopping

Shoppers may need more money from the bank this year. Unfortunately, there will probably be fewer sales in stores this season. Last year, shoppers reigned in their spending, leaving retailers with excess holiday inventory and thus big discounts at the end of the season.

This year many retailers are hedging their bets, deciding they would rather risk running out of popular items. So don't expect the major markdowns we saw last year. Here are other ways to save:

Ask about refunds. Retailers have been cracking down on refund and exchange policies. The confusing thing is that every store seems to have a different policy, and often those policies change during the holiday season. Typically, electronics carry the strictest policies. Write down the name of the sales associate who tells you about a generous exchange policy so that later on, if challenged, you will have the specifics on your side.

Save on shipping fees. If you need to buy an item online or through a catalogue -- because you are mailing it out of town or because the store doesn't have the size/color you need -- many retailers offer free shipping -- if you place your order at the store. Some retailers have special phones in the store. Pick it up and you are automatically connected to a service representative who will place your order and ship it for free. At other stores, you can ask a salesperson to place the order for you and it will be shipped for free. It's worth asking your favorite retailer if they offer this service.

Use a credit card. According to MasterCard International, six out of 10 banking customers have debit cards, and for the first time debit transactions for the year are set to outpace credit transactions. However, when doing your holiday shopping, you should consider using a credit card instead. Many credit cards provide benefits such as requiring merchants to exchange or replace defective or damaged merchandise, protection against no return policies and extension of manufacturers warranty. Also, your liability for fraudulent or disputed charges on credit cards is limited to $50 under the Fair Credit Billing Act. Even though some debit cards do provide comparable protection, your liability could be as high as all the money in your account and your credit line, depending on when you report the fraudulent or disputed charge.

Some retailers will offer 20 percent or more off your purchases if you open their credit card and charge those purchases to it that day. Open the card, get the discount, pay the card off and close it after the holidays.

Of course, use a credit card carefully. Don't charge yourself deep into holiday debt. When shopping with a debit card, at least you'll be forced to stop spending once your bank account is empty.

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